The lecture Investment and Financial Management covers theories and best practices related to firms’ financial and investment decisions. Regarding financial decisions, upon completion of this module, students will be able to understand the time value of money and how to use financial information to make decisions, such as reading balance statements and using company performance indicators to find an adequate capital structure and estimate the cost of capital. Furthermore, students will be able to apply concepts of capital budgeting and investment analysis to choose among investments.

A complete list of the topics follows:

• Introduction to Finance
• Financial Statement Analysis (e.g., balance sheet, cash flow, and profit and loss statements)
• Investment Analysis (e.g., net present value, internal rate of return, and alternative methods)
• Capital Budgeting (e.g., estimation of expected free cash flows, choosing among investments)
• Cost of Capital (e.g., equity costs, debt costs, and the weighted average cost of capital)
• Capital Structure and Modigliani-Miller Theorem

Exercise Investment and Financial Management

Students deal with the contents of the lecture Investments and Financial Management within the scope of the exercise. Students apply the contents and theory learned in the lecture and critically reflect on the results.

Upon successful completion of the module, students will be able to:

• understand and discuss one of the most important foundational concepts in finance, the time value of money.
• use techniques related to capital budgeting and investment analysis to make decisions about investments.
• apply information from company indicators and financial statements to make decisions to maximize the value of a firm.
• discuss and evaluate firms’ capital structure and capital structure theorems.

Berk, J./DeMarzo, P.: Corporate Finance, 5^th Edition, 2019.